Letter to CFPB on Regulation Z's Mortgage Loan Originator Rules Review Pursuant to the Regulatory Flexibility Act

Comment Intake—Loan Originator Rules
RFA Review, c/o Legal Division Docket
Manager, Consumer Financial
Protection Bureau, 1700 G Street NW,
Washington, DC 20552

To Whom it May Concern:

The American Bankers Association (ABA) appreciates the opportunity to submit comments on the Consumer Financial Protection Bureau's (Bureau) request for input regarding its review of Regulation Z's Mortgage Loan Originator Rules (LO Rules) pursuant to section 610 of the Regulatory Flexibility Act. A central objective of this review process is to determine whether the LO Rules should be continued "without change or amended or rescinded to minimize any significant economic impact of the rules upon a substantial number of small entities, consistent with the stated objectives of applicable Federal statutes."

Introduction

ABA supports the objectives of the LO Rules, which are designed to protect consumers by reducing ;incentives for loan originators to improperly steer consumers into loans with particular terms and by ensuring that originators and/or their employers are registered. The provisions to regulate mortgage loan originator practices were initially set forth via amendments to Regulation Z.4 These provisions, and additional revisions thereto, were eventually incorporated into Section 1403 of the Dodd-Frank Act, which created new TILA section 129B(c) for residential mortgage loans. The important point is that the loan officer compensation provisions under review are now largely codified in statute, and the implementing regulations are a crucially important tool to ensure compliance by all covered entities. Our comments reflect experience-based views from large and small depository institutions and make recommendations for amendment of the LO Rules that are intended to expand credit and augment the ability of financial institutions to serve consumers fairly and responsibly.

Download the comment letter to read the full text.